Countifmember Brandon T. Todd Comlipemter Renyan R. Mobatfie
Councilmember Anita Bonds Counej LCN
Councilmember Charles Allen
act David Grosso
A BILL
IN THE COUNCIL OF THE DISTRICT OF COLUMBIA
To establish the Office of Compliance as an independent agency to monitor compliance with
small business participation and first source requirements; and to amend the Small and
Certified Business Enterprise Development and Assistance Act of2005 to remove
responsibilities for compliance and enforcement from the jurisdictionofthe Department
of Small and Local Business Development,
BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this
act may be cited as the Independent Compliance Office Establishment Act 2019
TITLE I. ESTABLISHMENT OF THE OFFICE OF THE CHIEF COMPLIANCE
32 OFFICER.
33 Sec. 101. Definitions
34 Forthe purposeofthis title, the term:
35 (1) Agency means an agency, department, office, board, commission, authority
36 or other instrumentalityofthe District government, with or without legal existence
37 separate from thatofthe District government.
38 (2) Agency contracting officer means the contracting officer of an agency or
39 government corporation.
40 (3) Beneficiary means a business enterprise that is the prime contractor or
41 developer on a government-assisted project.
42 (4) CBE Act means the Small and Certified Business Enterprise Development
43 and Assistance Act of 2005 (Oct. 20, 2005, D.C. Law 16-33).
44 (5) Certified business enterprise means a local business enterprise certified
45 pursuant to CBE Act.
46 (6) Department means the Department of Small and Local Business
47 Development.
48 (7) Government-assisted project shall have the same meaning as provided in
49 section 2302(9)(A)-(F) of the CBE Act.
50 (8) Office means the Office of the Chief Compliance Officer.
Si Sec. 102. Establishment of the Officeofthe Chief Compliance Officer.
52 (a) The Office of the Chief Compliance Officer is established as an independent
53 authority. The Office shall be headed by a Chief Compliance Officer appointed pursuantto this
54 title by the Mayor with consent from the Council and who shall serve for a term of6 years and
55 shall be subject to removal only for cause by the Mayor with the approval of Council.
56 (b) The Office shall be composed of the Chief Compliance Officer and staff as necessary
57 to complete the work of the Office.
58 Sec. 103. Chief Compliance Officer.
59 (a) The Office shall be under the supervision ofa Chief Compliance Officer who shall
60 carry out the functions and authorities assigned to the Office.
61 (b)(1)The Chief Compliance Officer shall have full authority over the Office and all
62 functions and personnel assigned to the Office, including the power to re-delegate to other
63 employees and officials ofthe Office such powers and authority asin the judgmentof the Central
64 Compliance Officer are warranted in the interests of efficiency and sound administration.
65 (2) The Chief Compliance Officer shall develop and institute internal policies,
66 procedures, and processes to ensure efficient operations.
67 (3) The Chief Compliance Officer may establish divisions or other units, which
68 the Chief Compliance Office will oversee, as may be necessary or appropriate to perform the
0 functions and duties of the Office.
70 (4) TheChief Compliance Officer shall have authority to enforce provisions
1 pursuant to section 103 and may impose fines, fees, penalties, and other remedial actions
n pursuant to section 2363ofthe CBE Act.
B Sec. 104, Duties and functionsofthe Office.
74 (a) The Office shall monitor and ensure District Government agencies and beneficiaries
75 compliance with contracting and procurement requirements.
16 (1) The Office shall monitor an agencys compliance with the Districts
7 contracting and procurement goals pursuant to Section 2341ofthe CBE Act:
B (A) By October 1, 2020, and no later than October 1ofeach succeeding
79 year, an agency shall submit to the Office:
80 (i) A spending plan that details how an agency intends to spend its
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81 expendable budget with small business enterprises and certified business enterprises during the
82 fiscal year; and,
83 (ii) An annual allocation letter signed by the agency director on a
84 form prescribed by the Office that specified the agencys 50% expendable budget goal.
85 (B) The provisions of this title relating to contracting and subcontracting goals
86 and requirements shall be applicable to every government-assisted project, unless the Office, by
87 regulation, establishes a specific exemption for a particular type or class of government-assisted
88 project.
89 (2)(A) An agency may decline to award a contract or procurement set aside pursuant to
90 section 2344 or Section 2345 of the CBE Act and shall write a determination pursuant to section
91 2344(a-1) or (b) or section 2345(b) or (c) ofthe CBE Act.
92 (B) Each written determination shall be submitted to the Chief Compliance
93 Officer, who shall post a copy of the determination so that it can reasonably be accessed by the
94 public via the Office's website or such other locations as the Office may establish.
95 (3) An agency that would like to fulfill a follow-on or renewable acquisition without
96 using a small business enterprise or certified business enterprise shall:
97 (A) Make a written request to the Chief Compliance Officer; and
98 (B) Receive written approval from the Chief Compliance Officer to allow the
99 agency to waive the requirements set forth in section 2345 of the CBE Act.
100 (4) The Office shall monitor compliance with District subcontracting requirements
101 pursuant to section 2346 of the CBE Act:
102 (A) No beneficiary shall be allowed to amend the subcontracting plan filed as part
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103 of its bid or proposal except with the consent of the Chief Compliance Officer. Any reduction in
104 the dollar volume of the subcontracted portion resulting from such amendment of the plan shall
105 insure to the benefitofthe District.
106 (B) A beneficiary shall submit to the agency contracting officer, project manager,
107 and Chief Compliance Officer copiesofthe executed contracts with the subcontracts identified
108 in the subcontracting plan. Failure to submit copies of the executed contracts shall render the
109 underlying contract voidable by the District.
110 (C)Abeneficiary shall provide a quarterly report to the Office, agency
i contracting officer, and project manager. The quarterly report shall include the following
112 information for each subcontract with a subcontractor identified in the subcontracting plan:
113 (i) The price to be paid by the beneficiary to subcontractor under the
114 subcontract;
HS (ii) A descriptionofthe goods procured or the services subcontracted for;
116 (iii) The amount paid by the beneficiary to the subcontractor under the
7 subcontract; and
118 (iv) A copy of the fully executed subcontract, if the fully executed
119 subcontract was not provided in a prior quarterly report.
120 (D)(i) The beneficiary shall meet on an annual basis with the Office, agency
121 contracting officer, and project manager to provide an update of the subcontracting plan for
122 utilizationof small business enterprises and certified business enterprises.
123 (ii) The beneficiary shall be given a 30-day written notice of the meeting
124 by the Office.
125, (E) The beneficiary shall provide written notice to the Office upon the initiation
126 and completion of a project.
127 (5) The subcontracting requirements of section 2346 of the CBE Act may be waived only
128 if there is insufficient market capacity for the goods or services that comprise the project and
129 suck lackofcapacity leaves the contractor commercially incapableofachieving the
130 subcontracting requirement at a project level. The subcontracting requirements of section 2346
131 of the CBE Act may only be waived in writing by the Chief ComplianceOfficer. An agency
132 seeking waiverofthe subcontracting requirementsof section 2346 of the CBE Act shall submit
133 to the Chief Compliance Officer a request for waiver, which shall include the following:
134 (A) The numberofcertified business enterprises, if any, qualified to perform the
135 elements of work that comprise the project;
136 (B) A summary of the market research or outreach conducted to analyze the
137 relevant market; and
138 (C) The consideration given to alternative methods for acquiring the work to be
139 subcontracted in order to make the work more amenable to being performed by certified business
140 enterprises. :
141 (6) Before the Chief Compliance Officer approves an agencys waiver request, the Chief,
142 Compliance officer shall:
143 (A) Send an electronic notice to all certified business enterprises notifying them
144 ofthe agencys waiver request; and
145 (B) Post a copy of the agencys waiver request on the Offices website, or such
146 other locations as the Office may establish, for 10 days to provide the public reasonable
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147 notice of the waiver request.
148 (7) If the Chief Compliance Officer approves an agencys request for waiver of the
149 subcontracting requirementsofSection 2346 of the CBE Act and grants such a waiver, the Chief
150 Compliance Officer's determination shall set forth the information outlined in subsection (5) of
151 this section. A copyofthe Chief Compliance Officers determination shall be posted to the
152 Office's website or such other locations as the Office may establish for 5 days such that the
153 public shall have reasonable access to the determination before the Chief Compliance Officer
154 grants any waiver. After a final determination on a waiver is determined, the Officer shall post
155 the final determination on its website.
156 (8) The Office shall develop enforcement mechanism against an agency:
157 (A) Ifan agency fails to meet any goals set forth in section 2341 of the CBE Act,
158 the Office may require that a portion of the agencys contracts and procurements be made part of
159 a set-aside program for small business enterprises.
160 (B) The performance plan for each agency shall include a metric for compliance
161 with the provisionsofthis subchapter and the performance evaluation for each agency director
162 shall reflect the agency's success in meeting compliance goals.
163, (9) Each agency shall submit a quarterly report to the office within 30 days after the end
164 ofeach quarter, except for the 4" quarter report. The 4" quarter and annual report shall be
165 submitted together. When submitting a quarterly report, the agency shall list each expenditure as,
166 it appears in the general ledger from the expendable budgetofthe agency during the quarter. For
167 each expenditure, the report shall include:
168 (A) The nameof the vendor from which the goods or services were purchased;
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169 (B) The vendor identification number;
170 (C)A descriptionofthe goods or services provided;
171 (D) Whether the vendor was a small or certified small business enterprise;
172 (E) The funding source for the expenditure (local, federal, capital, or other);
173 (F) The dateofthe expenditure;
174 (G) The dollar amountofthe expenditure; and
175 (H) The percentageofthe agency's total dollar amountof expenditures in the
176 quarter to all small business enterprises and certified business enterprises.
177 (10) In addition to the reportof prime contracting activity required by paragraph (9) of
178 this subsection, each agency shall also submit to the Office within 30 days of the endofeach
179 quarter, a report on a contract basis of payment made by beneficiaries to subcontractors that are
180 certified business enterprises and such payments shall be reported against the amounts included
181 in the. Approved detailed certified business enterprise subcontracting plan.
182 (11) each agency shall submit to the Office, within 30 days of the issuanceof the
183 Comprehensive Annual Financial Report. An annual report listing each expenditure as it appears
184 in the general ledger from the expendable budgetofthe agency during the fiscal year which shall
185 include:
186 (A) The information required to be included in the quarterly report (with
187 calculations for the fiscal year);
188 (B) A description of the activities the agency intends to make during the
189 succeeding fiscal year to the activities it engages in to achieve the goals set forth in section 2341
190 of the CBE Act; and
191 (C)A description of any changes the agency intends to make during the
192 succeeding fiscal year to the activities it engages in to achieve the goals set forth in section 2341
193 of the CBE Act.
194 (12) The Office shall monitor agency compliance with the reporting requirements of this
195 section. ,
196 (13) The Office shall review the annual reportofan agency to determine whether the
197 planned activities of the agency for the succeeding fiscal year are likely to enable the agency to
198 achieve the goals set forth in section 2341of the CBE Act. The Offices recommendations shall
199 be submitted to the agency and the Council within 30 days of the agencys annual report
200 submission.
201 (14) Within 45 days after its receipt of the annual reports required by paragraph 11 ofthis
202 subsection, the Office shall submit to the District of Columbia Auditor the following documents
203 and information:
204 (A) A copy of the annual report required by paragraph (11) of this subsection; and
205 (B)A chart listing the following information with respect to each agency for the
206 current fiscal year:
207 (1) The total budgetofeach agency;
208 (2) The expendable budget of each agency;
209 (3) A descriptionof each funding source, object class, object,or item that
210 was excluded from the total. Budgetofthe agency in the Offices calculation of the expendable
2ul budget of the agency;
212 (4) Each goal of the agency under section 2341 of the CBE Act in
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213 percentage and dollar items; and
214 (5) The actual dollar amount expected with each small business enterprise
215 and certified business enterprise.
216 (15) Within 45 days after its receipt of the annual reports required by section 2350(g) of
217 the CBE Act, the Office shall submit to the District of Columbia Auditor a report containing the
218 following information with respect to each government corporation for the current and prior
219 fiscal years:
220 (A) The expendable budget ofthe government corporation.
221 (B)A list ofall agencies and government corporations that have not submitted a
222 report for that quarter with a detailed explanation of what actions were taken by the Office to
223 effectuate compliance with the reporting requirement.
224 (16) On a semiannual basis, the Office shall report the following to the chairman of the
225 Council committee that has purview over the Office:
226 (A) District agencies compliance with section 2341 of the CBE Act;
227 (B)A list of contracting opportunities for small businessenterprises and certified
228 business enterprises with District agencies;
229 (C)A list ofprojects in the District that require a 35% minimum subcontracting
230 requirement in accordance with section 2346of the CBE Act;
231 (D)Alist of beneficiaries, small business enterprises, certified business
232 enterprises, or certified joint ventures that fail to meet the 35% minimum subcontracting
233 requirements in accordance with section 2346of the CBE Act;
234 (E)Alist of projects in the District that have a 20% equity and development
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235 participation requirement in accordance with section 2349a of the CBE Act;
236 (F)Alist of District government contracts or procurements and government-
237 assisted projects that were granted waivers or modifications to the requiremnts set forth in
238 section 2346 of the CBE Act;
239 (G)A list of District agencies that fail to meet the requirement set forth in section
240 2341 of the CBE Act; :
241 (H)A list of small business enterprises and certified business enterprises; and
242 (I)A list ofjoint ventures certified by the Department, including the number of
243 compliance checks completed on the joint ventures and a summaryofthe results, and a list of
244 joint ventures that met the requirements set forth in section 2339(a)(i) of the CBE Act.
245 (17) It shall be a violationofthis subchapter and penalties shall be assessed if the Office
246 determines that:
247 (A) A beneficiary, certified business enterprise, or certified joint venture fails to
248 comply with the requirements set forth in section 2346, 2348, or section 2349aofthe CBE Act;
249 (B)A certified business enterprise:
250 (i) Acted with gross negligence, financial irresponsibility, or misconduct
251 in the practiceof a trade or profession;
252 (ii) No longer qualifies as a local business enterprise; or
253 (iii) Misrepresents its capability to the Department; or
254 (C)A beneficiary, certified business enterprise, or certified joint venture has:
255 (i) Fraudulently obtained or held certification;